Finally Buhari Succumbs To IMF’s Pressure, Devalues Naira To N290

It seems that rumours about naira devaluation are actually true. Reliable sources from President Muhammadu Buhari administration have assured Sahara Reporters journalists of imminent devaluation of the Nigerian currency.

According to presidential top aides, the president has already agreed to demands by the International Monetary Fund (IMF) and is ready to devalue naira that would be fixed at N290 to a dollar. Recall that the current official rate is about N200 to a dollar.

An anonymous economic adviser to the president said:“The truth is that Nigeria cannot operate without sourcing credit from the IMF. And the IMF was adamant that we must devalue before they can discuss extending credit to us.”

Mr Buhari and his economic team reportedly accepted the IMF’s terms in order to get access to funds (up to $3 billion in credit facilities) and “bridge a critical shortfall in revenue occasioned by a drastic decline in oil revenues.”

There is information that Godwin Emefiele, the governor of the Central Bank of Nigeria (CBN), didn’t take part in the crucial discussions and the decision to devalue the naira was taken without his or any other bank representatives’ involvement.

The CBN official commented on the situation:“Some of us here are not opposed to devaluation, given our country’s present circumstances.” Besides, the source insisted that its CBN’s function and resposibilty to control Nigeria’s monetary policies.

One more insider provided information on the naira price in the parallel market, where it now reportedly sells at N331 per dollar.

He said:“The government cannot continue to operate under the illusion that the naira is stronger than it is. The only problem is that we did not start early enough to admit to Nigerians how bad the financial outlook was.”

Curiously, only two days ago Professor Yemi Osinbajo, Nigeria’s vice president, assured that President Muhammadu Buhari has consistently affirmed that the naira would not be devalued, despite some pressures from within and outside.

IMF has repeatedly again called on the Nigeria government to devalue its currency by adjusting the official exchange rate to a more market determined exchange rate, while offering credit liquidity to support Nigeria’s economy. However, the president had insisted on numerous occasions, before and after his election, that he would never devalue the naira.

Meanwhile, Vice President Yemi Osinbajo has released a statement explaining why the federal government had to increase price of petrol and introduce supply framework. The new deregulation policy saw the price of petrol skyrocketing from N86 per litre to N145.